I typically receive 2-3 investment proposals per week, mostly from online investment platforms. Very few end up convincing me enough that I actually invest my money in them.
A friend recently came across an interesting opportunity that he sent over to me to get my opinion.
Here’s the quick analysis I made; I think it’s a good case study to get an insight into some of the things I look at when evaluating opportunities.
The opportunity in question is a very novel one called Avo Owner. It consists in buying avocado trees in South Africa on a usufruct basis. So you don’t own the land but you own the trees and reap profits on the sales of fruit and the appreciating value of the trees themselves.
It might very well be a good investment, but I typically need to see more information before investing in something, especially since itâs something that I’ve never come across before.
I start by taking a look at the homepage and notice an immediate red flag:
The site says that this is a “Safe and secure investment opportunity that will generate a 3 year cumulative capital growth and return of more than 113%”.
Whenever a platform guarantees or implies a guarantee of profits like that itâs wise to stay away. What if the crops are destroyed by some bad seasonal weather or infestation? And how do I trust this guy with my money?
So far this sounds like anything but a âsafe and secureâ investment. Investments returns are almost always shown on a yearly basis, so putting a 3 year period to arrive at the 113% is misleading. It also makes little sense; am I getting a 113% capital growth or return from sales of avocados? If not downright scammy it hints at a level of unprofessionalism.
Doing a Google search returns very scant extra information. Thereâs a YouTube video which shows the orchards and the owner of the operation, but itâs something they produced themselves. I can see that they were crowdfunded through Seedtribe, although there are no specific details available there either.
Just to explore how the site works, I tried buying a few rows of orchards costing around $10,000. It sent me to the checkout page, asking for some basic information before I hit the button to purchase, as it if were some $10 electronic item youâd purchase online.
Moreover, the checkout page itself is not even secure. Nowadays most sites are completely secured using SSL, but this site doesn’t even have the checkout page secured. This prompted me to check out the code of the site, which looks pretty basic and amateurish, and definitely didnât cost much to build, given the shortcuts taken and lack of professionalism in the code.
My conclusion is therefore that the opportunity is quite risky due to the scant information available, and I would definitely not invest in it myself.
If I were absolutely in love with the idea and lived anywhere close to the orchard, I would perhaps actually get to know the owner and then think about doing some investment after having gathered the extra information needed.
However, as an online investment, it simply doesnât make sense in my opinion.
Interesting read, i googled around for some information on people who actually own Avo trees with this company but this was about all i could find.
The comments are interesting as well, however i have cash to splash and like the idea, upon checking the website at the current moment they are all sold out and i can’t purchase any, until current owners sell or they plant more. The fact that i can not actually spend money with this company tells me it is legit, in some sense anyway.
Just thought i’d share this information.
Thank you, Brett, the analysis done by Jean were most certainly quickly done during 2017 in the early stages of our start-up platform. His post is continuously causing question marks and added administration. Nevertheless, he controls the information and what is posted. So, we have to make the best of this negative review.
You are correct, we were sold out early April 2020 but traders buy and sell their trees all the time. Young trees purchased at USD135 in 2016 are now trading at USD250.00. The same trees are now 6 years old and started to produce exceptionally good quality fruits. You can have a look at our own distribution network, AvoFit, which sell our avocados locally in South Arica. Here are links to the Facebook pages and reviews: https://www.facebook.com/AvoFitPretoria – and in the Western Cape https://www.facebook.com/AvoFitGeorge/ – AvoOwnerâs Facebook page https://www.facebook.com/avoowner/ – Our websites and trading platform might not be as brilliant and out of this world incredible like Jean Galeaâs platforms, but we have world class avocados consumed by thousands of people around the world. I hope you get to enjoy some of our fruit in the future. đ Ps! We will be planting about 600 new avocado trees during the 2020 season and aim to establish about 30 000 trees during the next 5 years.
Hi Jean,
I invite you to participate in a full due diligence process with regards to my avocado usufruct model.
The information contained in this case study is incorrect, for example you cannot just buy USD 10 000.00 of avocado usufruct without a 22 page purchase agreement making our responsibilities clear.
The entire website is secured. If you find pages that is not, we will gladly make them secure.
I agree that we can refine our offering and we have done so during the last 4 years.
I hope that we can change your case study by providing you with transparent information.
Hi Johan,
Thanks for reaching out. The information in the article was correct when I first evaluated the platform last year. It looks like you’ve amended things which is a good step in the right direction.
On the other hand, the website still looks amateurish so I stand by my opinion on that. There are many scam platforms and while AvoOwner might not be a scam platform, the lack of polish of the website and the way everything works does not inspire enough confidence for me to invest nor recommend the platform.
I am not sure what you mean by amateurish.
The email I received from [email protected] requesting me to confirm subscription to Jean Galea blog is terrible! You are using 4 different fonts without line breaks – that Jean is amateurish.
AvoOwner will continue to enhance our platform and update our international customers base.
I am happy that fake and unsupported due diligence done by Jean Galea is not an investor or customer with AvoOwner.
Unfortunately, your reply only serves to further confirm my initial thoughts.